New home sales in US likely to have rebounded in June

New home sales in the US are expected to have risen slightly in June, following a decline in the prior month. New home sales are likely to have rebounded by 2.4 percent to 564,000 units in June after declining 6 percent in May, stated Societe Generale in a research report.

The decline registered in the month of May reversed nearly around half of April’s 12.3 percent sharp increase. However, on year-on-year basis, it had risen 9 percent. In May, the six-month average rate of sales rose to 541,000, slightly more than 11 percent above the rate recorded in December.

Rebounding labor market, near-record low mortgage rates and moderate rises in wages continue to underpin new home sales in the US, according to Societe Generale.

The July NAHB index showed that the current sales of single-family units continued to be strong. The index had posted a reading of 63, near to the six-month average of 64. In the mean time, single-family starts rose 4.4 percent in June, indicating a rebound in new home sales, stated Societe Generale.